Dáil Éireann Debate, Tuesday - 16 June 2020
1059. Deputy Catherine Murphy asked the Minister for Housing, Planning and Local Government his plans to extend to first-time buyers the incentives and assistance to persons seeking to purchase a home that is not a new build; and if he will make a statement on the matter. [10764/20]
View answerThe statutory basis for the delivery of affordable housing for purchase in the State is Part 5 of the Housing (Miscellaneous Provisions) Act 2009, which I commenced in June 2018. Regulations in respect of the making of a Scheme of Priority were signed in March 2019, and were subsequently issued to local authorities. The Scheme of Priority sets out the affordable purchase arrangements at local authority level, including the methodology to be applied by local authorities to determine the order of priority to be accorded to eligible households where demand exceeds supply. Further regulations are currently being drafted regarding eligibility and other matters.
To support the delivery of the affordable homes that will be made available by local authorities for purchase under the scheme, the Government has made €310 million available under the Serviced Sites Fund (SSF). This fund sub-vents the cost of facilitating infrastructure and a maximum SSF funding amount of €50,000 is available per affordable home. On this basis, at least 6,200 more affordable homes, to buy or rent, can be facilitated by this measure alone. This funding is being made available in areas where local authorities have demonstrated a requirement for more affordable housing and the viability to deliver such housing from their sites. To date, funding of €127 million has been approved in principle to provide infrastructural work that will support 35 projects in 14 local authorities, delivering 3,200 homes.
By its nature, this initiative is centred stimulating the construction of new housing via infrastructure that would otherwise not have taken place and at more affordable levels. In doing so it will have the secondary benefit of relieving pressures on the wider existing housing market. There are no plans at present to extend the scope of the scheme to cover existing dwellings.
In relation to social housing, I can confirm that the Tenant (Incremental) Purchase Scheme applies to homes that are not a new build. The scheme is available for eligible local authority tenants for the purchase of existing local authority houses at a discounted price based on the applicant’s income.
A further and longstanding support for people seeking to buy their own home are mortgages provided by local authorities. The current mortgage product being offered is the Rebuilding Ireland Home Loan (RIHL), which was launched on 1 February 2018. The loan enables credit-worthy first-time buyers who cannot access sufficient mortgage finance from a commercial lender, to access sustainable mortgage lending to purchase new or second-hand properties in a suitable price range.
The interest rates charged on the loans under the RIHL are as follows:
- Fixed rate for terms up to 25 years 2.745%;
- Fixed rated for terms up to 30 years 2.995%;
Under the Rebuilding Ireland Home Loan, single applicants must not be earning more than €50,000 gross per annum, while the combined income of joint applicants must not be greater than €75,000 gross per annum.
Borrowers may obtain up to 90% of the market value of the property they propose to purchase or build. The purchase or self-build of a property must not exceed the maximum market value applicable for the county in which it is located:
- €320,000 maximum purchase price for properties in Cork, Dublin, Galway, Kildare, Louth, Meath and Wicklow (maximum loan amount of €288,000);
- €250,000 maximum purchase price for the rest of the country (maximum loan amount of €225,000)
Funding for new RIHL lending of up to €210 million is in place for 2020.
Further information on the scheme is available on the following website: www.rebuildingirelandhomeloan.ie.
